I have noticed an increase in cancellations on $5 gigs. Typically, I have a couple cancellations every month and run about 8%. Since joining Fiverr last year, I have steadily moved toward high dollar, custom gigs as opposed to multiple gigs through the open marketplace. As my gig prices increase, so do my cancellations. Buyers simply do not read or comprehend the gig details and think they are getting the world for $5 when they simply are not.

I am concerned about my cancellation rate because my denominator is not increasing like it was previously because I am focused on high dollar, low volume custom gigs. So when I get a cancellation it has a much larger effect on my overall cancellation rate. I realize the Fiverr “powers that be” no longer state what amount of cancellations they get concerned about, but I feel refunds are a natural course of business, especially in this type of online environment.

My suggestion to Fiverr: instead of calculating cancellation rates as functions of quantity, calculate them as functions of value.

Under the current method: I complete 100 gigs in a month and cancel ten of them for a rate of 10%

INSTEAD calculate the amount of the cancellations vs. the total revenue I have brought in that month.

Under my proposed method: I close $1300 in a month and cancel the same ten gigs for $50 which equates to a cancellation rate of 3.8%

Just about 100% of my cancellations are for basic $5 gigs where the buyer doesn’t read the description, expects too much, or has some other miscommunication. I completely understand sellers being punished if they are late and a buyer cancels, but 99% of my cancellations are due to unrealistic buyer expectations, or, a mistake where they reorder the proper gig after the cancellation. I want to deliver great customer satisfaction but sometimes its just not possible. Every business experiences this and savvy sellers know when to move on. Cancellations based on value seems like a better way to keep an eye on refund rates for both Fiverr the company and Fiverr sellers.